Markets are 3-5% higher around the globe, as the Europeans surprised traders with their ability to a) work cooperatively; b) write ginormous checks; 3) engage in quantitative easing.

To parahrase Ned Davis, “Give me a trillion euros, and I will throw you a hell of a party.”

Here’s the NYT:

“European leaders agreed early Monday to provide a huge rescue package of nearly $1 trillion to combat the debt crisis that has engulfed Europe, and global markets responded by reversing the steep declines of recent days.

In an extraordinary session that lasted into the early morning hours, finance ministers from the European Union agreed on a deal that would provide $560 billion in new loans and $76 billion under an existing lending program. Elena Salgado, the Spanish finance minister, who announced the deal, also said the International Monetary Fund was prepared to give up to $321 billion separately.

Officials were hoping the size of the program — a total of $957 billion — would signal a “shock and awe” commitment in the same vein as the $700 billion package the United States government provided to help its own ailing financial institutions in 2008.”

The bailout train continues.

Based upon the reaction in the US futures — the Dow is up 400 — traders were surprised by the swiftness of the European’s move.

When the US began its massive bailout plan in October 2008, markets had been falling for 10 months, and were down 20% from peaks. Ultimately, the liquidity added was rocket fuel to the markets, and after they fell a total of 55%, a 75% rally ensued over the next year.

Europe has now gone down the same path — but from a very different location in the market cycle. I would not expect the reaction to be identical, but one must be very cognizant of the impact a trillion dollars will have on markets.

We have seen this movie before.


E.U. Details $957 Billion Rescue Package
NYT, May 10, 2010

Category: Bailouts, Investing

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

67 Responses to “EU to Dump a $Trillion Dollars into Eurozone”

  1. Patrick Neid says:

    OK everyone, act surprised.

    I guess our 1000 point “airpocket” was to clean out the stops before going higher. They reversed a lot of the trades but not the stops. Welcome to the shark tank.

  2. Abhishek says:

    The weekend bailout expectations have worked out with the shorters squeezed out . The message was unequivocal,when in trouble we will drown you with currency.Even the friendly Fed which has bee quantitative easing the problems across the Atlantic away came in with a helping had.The Fed will “provide the European banks” with dollars as needed.The Fed would be providing dollars to the Greek banks in lieu of the junk Greek bonds.

  3. jpm says:

    3) engage in quantitative easing.

    Which part did you think was QE?

    As of last night EST, there was no QE, all of the monies were sterilized.


    BR: Coming soon to a eurozone near you . . .

  4. Dennis Gartman says:

    The most important decision was that mandating that the ECB accept a mandate to buy European debt directly from the governments in question. The ECB has said time and time and time again that it would never monetize anyone’s debt obligations, but that is precisely what it has agreed to do.

    We note that it was only last weekend… only last weekend… a mere eight or nine days ago!!!… that Mr. Trichet said emphatically that the ECB’s authorities had “absolutely no intention” of buying government debt. However, when the bank agreed to accept any and all Greek debt as collateral for future borrowing by the Greek government from the Bank the die was cast.

    This decision tells us unequivocally that the independence of the ECB has been utterly and completely compromised and that the political will of Brussels has trumped the economic will of Frankfurt.

  5. JPM:
    So why the huge jump in the market? And do you really believe the money is sterilized? Just because they put that in a press release doesn’t make it so.

  6. Captain Jack says:

    Colonel Sandurz: Prepare ship for light speed.
    Dark Helmet: No, no, no, light speed is too slow.
    Colonel Sandurz: Light speed, too slow?
    Dark Helmet: Yes, we’re gonna have to go right to ludicrous speed.

  7. Mike in Nola says:


    I assume you have reversed your search for good shorts? I’m sure there will be some, but how long will it take for them to materialize after the squeeze?


    BR: This is a major unexpected change — I want to:

    1) review market internals
    2) digest the euro action;
    3) see where we ended up last week and make adjustments

    before putting on any major new positions.

  8. constantnormal says:

    Aye aye, Capt’n Jack — full ludicrous speed it is …

    I wonder if the Dow will hit 20,000 by June? And if it will crack 5,000 by July?

  9. constantnormal says:

    BR, are you now working on a companion book for the EU? Bailout Union?

  10. constantnormal says:

    To be followed, of course, by Bailout World

  11. That’s great — my post on this is here

  12. rktbrkr says:

    Will the riots move from Athens to Berlin?

  13. constantnormal says:

    Interesting that gold has not spiked with the news … I guess that the gold bugs have not had their morning coffee yet.

    Although, this much money goosing things, it’s beginning to look like the next bubble is a currency bubble … maybe I need to be giving gold a closer look.

  14. buckykatt says:

    I don’t know what the future fallout of this $1 Trillion add will be, but overnight and this morning have been something to play if you are a trader. Amazing!

  15. Michael M says:

    ECB broke a commitment not to assist individual countries when they assisted Greece. Furthermore, four days ago, Trichet said bond purchases hadn’t been discussed. Now they will buy bonds. In other words, the ECB cannot be trusted.

    EBC’s mission is to contain inflation period – in other words they now have mission drift.

    European political leadership ignored Trichet’s earlier pleas for a fast aid package to Greece and his advice that the International Monetary Fund not be included in any rescue of Greece – in other words ECB is no longer respected by the European leadership.

    And it looks very much like ECB independence is weakening now that they clearly work closely with Bruxelles.

    Dependent, ignored, drifting and not trustworthy. And that’s just the ECB – not even mentioning the fundamental problems in Europe.

    Plus lots of questions remain: Are these actions legal, what kind of backlash will we see from opposition parties, how solid is France really, how solid are the German states, will the South accept welfare cuts and higher taxes, what about non-Euro countries like the UK, Hungary and Poland: how will the panic affect consumer spending and retail investors, where does the Euro go from here, what if rates in the Euro-zone go up in general, how will markets react to any further deterioration in economic indicators in major Euro-zone economies, will politicians demand a pound of flesh for saving the banks again, will there be new CDS regulation, how much will all this cutting and taxing inhibit growth, will any further Euro weakness push China to buy bunds instead of treasuries and so on.

  16. rktbrkr says:

    So the ECB is printing Euros to buy PIIGS bonds because the free market had determined they were overpriced…an immediate bailout for the banks holding those bonds. I guess it’s reasonable to assume the borrowing costs of the inner circle (Germany, France,Benelux) will go up unless we live in a world like Lake Wobegone where there are only winners.

    Will the PIIGS actually impose austerity measures when they have such high unemployment and sick economies?

    It’s good to see the Germans have gotten over the Weimar hangups and gone “all in” on this currency printing the game. Will “defending the Euro” actually lead to it’s destruction by debasing it??? I guess as long as all major currencies debase side by side everything will be fine.

  17. Mike in Nola says:

    Ironic headline of the day at the FT:
    “Investors welcome €720bn EU bail-out ” as if those profiting are “investors.”

    BTW, this is going to cost US, of course. IMF is going to put up >$250B and we pay abotu 20%. This is in addition to the currency swaps Ben has implemented to bail out the Euro and decrease our purchasing power.

  18. cewing says:

    “Will the riots move from Athens to Berlin?”

    Doubtful. Rich people don’t riot. Maybe they can import some Tea Baggers?

  19. rktbrkr says:

    “The 440 billion part of money made available from Eurozone nations will not be available until it has the final backing of countries involved so the funding entity can borrow money in the capital markets. This indirect method of creating the pool is because of regulations among EU nations that do not allow one country to take on the sovereign obligations of another.”

    If the Germans were reluctant to fund the much smaller Greek bailout will they bailout on this much bigger bailout – especially following the electoral loss by Merkels party?

  20. Patrick Neid says:

    For the technically inclined the spooz will be hitting a .618 retrace at the open if prices hold up. In the old days that was generally a good place to lay a trade on. Should we take out last week’s lows that sound you hear will probably be a fat lady singing.

  21. [...] The EU comes up with a trillion dollar package for the Eurozone.  (TBP) [...]

  22. cognos says:

    Why do some many of you guys think this is bad?

    The whole point of government. The whole point. Is that in many cases the “collective” can solve problems better than the individual agents left to themselves.

    Trace human history… many problems have been solved this way — sanitation, transportation, education, removal of violence and the rule of law. None of those problems can be solved individually. Cannot happen.

    Now, why do you prefer rocky crazy markets (such as US banking 2008 depression… and then 2009 follows with 300% returns in C, BA)? Why is that prefered? Why do you like “toxic” assets going down 95% and then back up 1800%? Speculators love this. Citizens should not. Citizens should want more, clear, early management of crisis.

    The PROBLEM this whole time… is that the government regulations did not face obvious problems in early 2008 (post-Bear) and provide simple steady solutions. If they did this… sure maybe 20% losses were necessary. Maybe even some govt and taxpayer costs (the TAXPAYER is RESPONSIBLE for poor senators, regulators, fannie, freddie, etc!). But either way… keep things steady.

  23. IvoZ says:

    @ cognos

    The problem is not what you think it is. The problem is that special interests are sucking too much from the public system by gambling with OPM and privatizing profits while socializing losses and making the system i) unstable and ii) misallocating resources, which further destabilizes the system. Govt policy serves mainly these interests and is biased. That is the true problem. All measures to keep “stability” in the system are efforts to keep this real problem unadressed. The problem is systemic.

  24. wally says:

    Another trillion floats out with no good place to go… more speculation ahead.

  25. Sircornflakes says:

    Oh the money has to be paid back?

    Just wait for the global rise in inflation so that debt can be repaid in worthless fiat paper.

    “Greek austerity measures”, my new fave oxymoron.

  26. FrancoisT says:

    From my very minimal knowledge base in high finance, I have it that the big problem in the financial system is too much debt.

    Therefore, how is a trillion euros help solving this problem?
    Debt will be erased by adding money to the markets? How?

    Is they gonna trade until debts are absorbed?

    Blimey! While looking for an answer, I see that Mish (who sure knows more about that than I do ) wrote:

    Step back for a second. The problems are too much debt, too much government spending, and a massively unbalanced global economy. None of these actions address any of the fundamental issues.”

    Gee! For a moment, I thought it was just me.

    All the above begs the questions:

    What’s the real deal here?
    What’s the plan? IS THERE a plan?

    Or is it just a throw-money-and-pray strategy here?

  27. Kort says:

    In unrelated news, 60 Minutes had a piece last night about more people walking away from their mortgages, even though they can well afford their mortgage payments. The main focus was on a young couple that bought a house for $270K and now it’s worth about half. Even though they can make the payments, they stopped in December and expect to be evicted, formally and finally, in July. 7 months of free rent. 1) wonder why consumer spending was up in Q1? Talk to people like this… and 2) banks aren’t marking-to-makeup the decreased “value” of the houses…wait for it.

    Meanwhile, elsewhere, across the pond, a trillion pieces of paper fall from the sky like mana from heaven or heroin to a junkie.

  28. Michael M says:

    At Cognos,

    This is problematic because you are saving bond holders (mainly German and French banks) with taxpayer money and you are doing so to protect a construction – the euro – that is flawed in that it requires that European economies be similar in nature, which they are not. In order for this project to work longer term, you need to make these economies similar i.e. more like Germany. That means major changes to taxation, welfare states, union power etc. Whenever you put this up for a vote in Europe you get in trouble – now they ram it through without a vote, which can be viewed as a good and necessary thing for Europe, however, it is very doubtful that the people of Europe actually want this.

    To me the main market problem here is that we are totally dependent on bond and equity prices to fund our retirements and for our overleveraged societies to work. Unlike the 1930ies and 1970ies, stocks and bonds being so widely held today are now weapons of mass destruction as much as derivatives are thereby forcing government to go all in and printing more chips on top of that whenever things get wobbly.

    But ultimately I am an investor and care more about the investment implications. The question to me is how many people can you get into a lifeboat before you sink the lifeboat too and what are the signs to look for that the lifeboat is taking in water?

  29. cognos says:

    IvoZ – no “losses” have been socialized. Most of the bailouts are CLEARLY profitable. The main potential socialized losses are in the quasi-govt institutions, like Fannie and Freddie. Even these will be deminimus.

    Otherwise, where are the specific losses? The real “losses” are the frictional costs to everyone, unemployment being the largest. And then the lower tax revenue associated with the downturn.

    Remember, the US financial sector pays about $500B per year (!) in taxes. Stop with the dumb idea that “main street bailed out wall street”. Taxes in this country are largely paid by the top 10% of income earners. Taxes are largely paid by California and New York and other high-income coastal areas.

  30. Niskyboy says:

    Another interesting day on tap, eh?

  31. cognos says:

    IvoZ –

    Hidden within your point… there IS a point. Which is, a few special interest are currently the biggest beneficiaries of the system. How does one change that? (Answer – improve the tax code.)

    Related to this is why we have ZERO and will continue to have zero inflation. Because there is so little progressiveness in the tax structure.

    But the “bailouts” are net positive, good for all, and VERY VERY helpful to the little guy. If you want the system to have more “economic justive” … then start talking about taxes. And not have my HF manager boss paying 17% taxes on $300M in income.

  32. ZackAttack says:

    Wouldn’t it be hilarious if we closed flat on the day?

  33. SOP says:

    @ cognos

    You can bail them out – send your personal check to the PIIGS. Just so you can have “steady” markets to play in.

    Next week you can send them another check, and maybe send one to California or some other pig-state in the US.

  34. Sircornflakes says:


    That would not surprise me in the least.

    Sell into the rally. This house of cards is coming down.

  35. SOP says:


    “US financial sector pays about $500B per year (!) in taxes”

    Good. Have the financial sector pay an extra trillion for this bailout directly out of their pockets – and pay their taxes on top of it..

  36. Marcus Aurelius says:

    IvoZ & cognos:

    The problem is an international banking cartel (IvoZ’s ‘special interests’), deeply embedded into the governmental infrastructures of the developed nations, trying to pay for all of the debt money they created by issuing and trading/distributing between themselves (not among the riffraff/indebted, where it would actually begin paying-down the debt) copious and unregulated amounts of fiat currency. There’s profit in the imbalance (including the unnatural imbalance created when the banks are allowed to issue fiat in any number of ‘competing’ currencies under their control), and with fiat currency(ies), there need not be (in fact, in a fiat monetary regime, there’s no reason accounts shouldn’t balance to the penny).

    The fleecing and fraud continues.

  37. at the end of the day cognos it really is the widows and the orphans who are paying for this rampant inflation

    West End widow vows to fight eviction ‘until the end’

    This is happening all over and it is because all these dollars are goosing prices

  38. quiddity says:

    The CAC 40 is up 8% (so far). It’s all good.

  39. curbyourrisk says:

    I hope we sell the open…..lunch and the close and are down 200 points by the end of the day. That would teach those stupid Europeans to steal our thunder! SCREW THEM and their banks!

  40. rktbrkr says:

    Does anyone really expect the PIIGS will actually implement austerity measures? Greece and Portugal have unemployment rates comparable to the Eurozone average of about 10% but Ireland has 13% and Spain has 20% unemployment and both their formerly booming RE markets are as dead as Miami’s. What happens when they implement austerity – or what I really mean is what happens when they don’t? The Eurozone donors will be in too deep to quit and occupation of Spain and Ireland by German and French troops to exact reparations is so old school…

  41. ZackAttack says:

    Well, the US share via IMF is up to just under $50b now.

    Let’s see Congress pass that IMF funding bill this time. Every politico involved in this has written his professional death sentence.

  42. Marcus Aurelius says:

    “EU to Dump a $Trillion Dollars into Eurozone”

    The headline says it all, when considering The Big Picture.

    Where did this $Trillion dollars come from? It’s now debt? Who will pay that debt, and why (considering that what was ‘dumped into the Eurozone’ was created from nothing)? The taxpayer? Why is anyone taxed when their government can issue currency at will? The more important question might be — who will profit, by how much, and why?

    The markets’ rise on this news is herd mentality.

  43. powerpenguin says:

    So, how do people think US markets will respond to this bailout? Will this lead to a resumption of rising equity prices, or is this not going to change much in the end?
    I am honestly very uncertain. I get the feeling that the recent correction was more about strategic retrenchment rather than real fear regarding Europe. Quite a few market gurus predict the markets to end the year down from where they are now, and thus everyone fears a correction and is trying to time the market. The herd will be easily spooked.
    But, the big difference this time is that these interest rates are so unbelievably low. And what’s more, with the US looking at a deflationary environment for the future, the fed is not going to be changing rates for a long time.
    So, If you dump your stocks you are pretty much going to be sitting on cash; savings rates are terrible, bonds and treasuries are saturated, there’s still a huge excess supply in real estate…until some kind of alternative opens up, it’s plausible interest rates will force an equity bubble.
    What does everyone think?

  44. constantnormal says:

    @cognos just a hunch mind you, but I’ll bet that you would not be nearly so cheery if the roll-back of the bulk of the swing had not taken place, if you have been forced to live with your actions on last Thursday.

  45. Captain Jack says:

    Re, US equities, it will also be interesting to see how many underwater investors, still shell-shocked from last week’s nuttiness, use the Monday morning bounce as a last ditch gift to cut and run at slightly better prices than they could have gotten Friday.

    I mean let’s face it, the charts ain’t exactly confidence inspiring.

    And then you’ve got bloggers like Felix Salmon saying “GTFO”:

  46. ella says:

    As the US treasury and FED engaged in “shock and Awe” bailouts of the last few years the market always responded positively. A few days later, the markets headed south when the participants realized how serious the situation was and the consequences of the bailouts.

    A trillion $ bailout in the EU means that the problems are very serious indeed. How long will it take before the markets realized the true dangers that caused the EU/IMF/FED bailout? Just wondering?

  47. [...] my take on my favorite comment of this morning: “Coming soon from the author of Bailout Nation, a new look at the PIIGs [...]

  48. batmando says:

    @ cognos
    this is the “rule of law”?

  49. The Curmudgeon says:

    They can create out of thin air all the Euro’s they want. It won’t change anything but the accounting, just like 1.25 trillion dollars thrown at the US residential mortgage market didn’t change anything but the accounting for US homeowners, with the caveat that it mildly exacerbated oversupply problems as the free money temporarily created the illusion of demand.

    The problem Europe has is a demographically-driven decline in demand. Greece sports a median age of about 41 years, which is about average for the continent. No amount of fiat money will change the demographic realities that the continent is growing old and dying. Demographics are driving this decline, and will not reverse unless and until the Greeks become far less Greek, i.e., immigrants begin replacing the natives.

  50. constantnormal says:

    @ Cap’n Jack 9:32 am

    And it’s not like there is any confidence in stop-loss orders. Not after last Thursday.

  51. constantnormal says:

    @ Curmudgeon 9:57am

    “No amount of fiat money will change the demographic realities that the continent is growing old and dying”

    Well, at least us boomers are not leaving anything of value to the paltry few young whippersnappers that will follow us — all we’re leaving them are our debts!

    Who says you can’t take it with you?

  52. [...] The EU comes up with a trillion dollar package for the Eurozone.  (TBP) [...]

  53. The Curmudgeon says:

    “The main potential socialized losses are in the quasi-govt institutions, like Fannie and Freddie. Even these will be deminimus.”

    ~but what, exactly, is de minimis?

    May 10 (Bloomberg) — Fannie Mae, the mortgage-finance company operating under federal conservatorship, said it will seek $8.4 billion in aid from the U.S. Treasury Department after reporting its 11th-straight quarterly loss.

    The company said it had an $11.5 billion first-quarter loss in a filing today with the Securities and Exchange Commission. Washington-based Fannie Mae had posted $136.8 billion in losses over the previous 10 quarters and taken more than $75 billion in U.S. aid since April 2009.

    ~it’s just taxing people that pay their mortgages or don’t have one in order to subsidize people that don’t pay, in order to keep our international creditors that hold these crappy mortgages (China) happy. What a country.

  54. constantnormal says:

    Any similarities to the last days of the 1929 bubble in stocks are purely coincidental.

  55. The Curmudgeon says:

    “all we’re leaving them are our debts!”

    Which they’ll surely refuse to pay, either by inflation or some other mechanism.

    OT: I wonder if Bloomberg crashes on the way up like it did on the way down the other day? Perhaps we’ll see.

  56. IvoZ says:

    @ Cognos

    Losses have not been realized only because i) they were pumped up by newly printed money; ii) hidden on balance sheets. Losses are still socialized as printing money acts like a tax on every dollarholder. Bonuses are paid with no clawbacks on unrealized gains mostly, so they are privatized gains, gambled with OPM or with taxpayers and dollarholders on the hook (FDIC, Fed) for losses.

    All kinds of nominal amounts of taxpayer dollars paid by banks are not that important when $1-2tr can be printed overnight. And how many of the “earnings” of the banks, on which they pay taxes/bonuses are not subsidized by the state (FDIC, steep yield curve, bailout only for the oligopolistic players)? It is easy to pay “taxes” when your excess earnings are subsidized by the state in the first place.

    This is a most crony capitalistic regime and it is “in your face”. This is very close to fascism. And it is not only looting, it is a huge misallocation of resources – “killing the goose” in the meantime.

    @ Barry: I would be curious to see your take on this.

  57. JPorter says:


    “Greek austerity measures”, my new fave oxymoron.

    How exactly is that an oxymoron? Have you ever been to Greece?

  58. cognos says:

    IvoZ — Where are the losses? You use the word “losses” like the tax payer is paying something.

    Don’t you know that 75% of the bailout funds have been PAID BACK? (With profits! $50B in profits!) And the remaining 25% looks fine outside Fannie / Freddie. (Which are also fine)

    Then you vague act like ZIRP or some loan guarantees have some “tax” on every other dollar. Normally, this is called “inflation”… and its something we have not seen in a decade. We have deflation. Massive deflation.

    Problems of the “depression” are always basic “deflation” problems. Milton Friedman suggested that Japan have a “money financed tax cut”… that is — actually print money so that their overall society would be better off. Thats the right move, right?

  59. Moss says:

    These actions are totally consistent with the Central banks desire to inflate away the debt. They will do any thing to stop deflation from becoming the predominant force in the western economies.

  60. hgordon says:

    I don’t think cognos was far off-base with his comments until he went off the rails about bailout profits …

    Put this in perspective – EU aggregate GDP and money supplies are 15% higher than US equivalents. With this $1T action, the managers of the euro are essentially demonstrating some of the options available to the sovereigns that issue a fiat currency. Relative to the US actions over the past 18 months, it’s a fairly conservative move. The only net negative impart to the euro is a possible devaluation of the currency, but that was already happening anyhow.

  61. constantnormal says:

    Relax, cognos prolly believes ol’ smiling Ed Whitacre when he tells us in the teevee that GM has already paid back the goobermint … but what he does tell is that is was only the $7B in loans that was paid back, and that was paid not from profits, but from another TARP bailout pool. The $43B in stock equity Uncle Sam has in “protective custody” is awaiting an IPO of a billion shares of New GM stock at $43/shr.

    But cognos, bless his twisted little innumerate heart, surely thinks that GM has paid back all of its debts and is now proceeding to soar like the pig with wings that it is.

  62. constantnormal says:

    But cognos is correct when he points out that we are in a massive deflation — he just fails to follow his own logic and see that stocks are wildly overvalued, because like everything else during deflation, stock prices fall.

    These stock prices will come in line with the underlying backdrop of deflation, we just don’t know precisely when … but we can surely see how, as we have the example of past history to guide us.

  63. Hairyopagus says:

    The amazing about face by the ECB, and the sudden finding of a common direction by the EU Finance Ministers, and the huge size of their movement leaves me feeling that there is more to this than meets the eye, and leads me to think:

    It is the Trojan Horse again, and perhaps it is Sarkozy and Bernanke inside the horse this time!

  64. Thor says:

    Is there any reason the ECB couldn’t buy up all this sovereign debt by increasing the supply of money, only to turn around later and write it all off later? That would both shrink the money supply back down and reduce some of the crushing sovereign debt. . .

  65. The Curmudgeon says:

    The problem with printing money to avoid deflation is that in all these economies suffering from a contraction in demand, the velocity of money declines faster than the supply increases, because of the demographics. See Japan. Velocity of money in an economy is not unlike the metabolism rate of an organism. Youthful economies/organisms have high and rising velocities of money/metabolism. Aging ones have low and declining money velocity/metabolism rates.

  66. batmando says:

    as The Curmudgeon notes re velocity of money, with all the increase in money (debt) supply from ZIRP that has flowed into the TBTF, high frequency trading does not contribute to velocity of money no matter how many trades are executed per nano-second.

  67. Sircornflakes says:


    Yes I have. Greece is a fiscal basket case. This bailout proves it.

    Good luck implementing austerity measures in a country where they riot at the drop of a hat.